Stock Tax Implications

[Rsudenga19]

Hello,

I have sold $5k in stocks this year already and looking to sell $10-20k more. Can you help me understand how this may effect my refund? Does it make more sense to wait until January 2020 to sell more?

Thanks,

Ryan

[Anonymous]

against the sales proceeds you can deduct the stock cost.  if you end up with net income taxation depends on whether short term - stocks held 1 year or less -  regular tax rates or long term - stocks held more than 1 year.

if net loss, up to $3,000 per year is deductible the rest gets carried over.     we can not advise on when to sell your stocks. that's an economic ans personal decision. 

[Rsudenga19]

Thanks. So knowing that all of my stock is profit, no loss, and if I sell more than 1 yr old stock (long term), what is the tax %? And am I taxed just on the gains or the entire amount? Do they treat it like a bonus or regular pay?

[tagteam]

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@Rsudenga19 wrote:

Thanks. So knowing that all of my stock is profit, no loss, and if I sell more than 1 yr old stock (long term), what is the tax %? And am I taxed just on the gains or the entire amount? Do they treat it like a bonus or regular pay?

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You are only taxed on the actual gain, not the gross proceeds of the sale (i.e., the entire amount).

Further, your gains are taxed at long-term capital gains tax rates, which are 0%, 15%, and 20%, and not ordinary income tax rates (net (long-term) capital gains receive special tax treatment).

See https://www.irs.gov/taxtopics/tc409

[VolvoGirl]

Is this stock you get at work?  That might be entered or treated differently and also come on your W2.